Biodiversity credit markets are in nascent stages and require clear standards and methodologies for success.
Valuing and protecting biodiversity is crucial for the well-being of humanity and the economy, with growing recognition of biodiversity as a risk and opportunity in the business world.
Deep dives
Valuing Nature and Biodiversity Credits
The podcast episode explores the concept of valuing nature and the nascent stages of biodiversity credit markets. It discusses the importance of protecting and valuing biodiversity, the potential buyers for biodiversity credits, and lessons learned from other environmental markets. The episode also highlights the role of the private sector and public-private partnerships in solving biodiversity conservation problems. The focus is on the pay-for-success model as a form of public-private partnership and the potential role of the Task Force for Nature-Related Financial Disclosures in driving action to protect biodiversity and support emerging biodiversity credit markets.
The Potential of Biodiversity Credits
The conversation in the podcast revolves around the potential of biodiversity credit markets to address biodiversity conservation challenges. It emphasizes the need for clear standards and methodologies to ensure additionality and value in biodiversity projects. The examples of wetland restoration and water quality improvements are highlighted as successful models. The discussion also touches upon the challenges of liability transfer and the importance of building public-private partnerships to finance and implement biodiversity projects.
Public Conversation and Education on Biodiversity
The podcast acknowledges the need for increased public conversation and education around biodiversity. It recognizes that while climate change has garnered significant attention, biodiversity often remains an esoteric topic for many. However, the hosts emphasize that children and younger generations have a keen interest in and exposure to nature, making biodiversity more tangible for them. The potential role of disclosure frameworks, such as the Task Force for Nature-Related Financial Disclosures, in driving action to protect biodiversity and support emerging biodiversity credit markets is also discussed.
The Importance of Valuing and Protecting Biodiversity
The podcast underscores the importance of valuing and protecting biodiversity for the well-being of humanity and the economy. It emphasizes that nature and biodiversity have inherent value and that their preservation and restoration are crucial for the future. The episode explores the idea of creating units of biodiversity gain or improvement to offset or compensate for harm caused by human activities. It highlights the relevance of biodiversity to businesses and the growing recognition of biodiversity as a genuine risk and opportunity in the business world.
At the end of 2022, 200 countries signed the Kunming-Montreal Global Biodiversity Framework – what some have called the “Paris Agreement for Nature”. It calls on signatories to work together to enhance the resilience of natural ecosystems and to turn the tide on species extinction rates through the setting of national targets, the establishment of disclosure regimes and the creation of innovative financing mechanisms – such as biodiversity credits. While there has been some subsequent positive international progress on this front driven by the UK and others, most biodiversity credit markets remain in very nascent stages.
In this episode, HASI’s investment team lead for nature-based solutions Tim Mooradd speaks with Tim Male and Ryan Sarsfield of the Environmental Policy Innovation Center (EPIC). They discuss the imperative of protecting and valuing biodiversity, the existing and potential buyers for biodiversity credits, lessons learned from other environmental markets and much more.
Note also that the HASI Foundation recently provided a grant to EPIC for its work at the intersection of climate action and social justice.
